Business Clinic: New laws on online farm sales explained

Farmers Weekly‘s Business Clinic experts offer free advice on legal, finance, tax, insurance, farm management and land issues. Lawyer Peter Cusick of Thrings sets out consumer rights for good sold online.

Q: I own a farm shop and have started to sell goods online. I recently sold three tins of fruit-pie filling to a customer, who phoned me to confirm he received the order but said, as his wife doesn’t like the taste, he wants a refund under the new laws. He has not yet returned the tins to me. What do I do?

Peter Cusick
Thrings

A: There have been new regulations recently for businesses selling to consumers online and in shops. Some came into force in June 2014 under the Consumer Contracts (Information, Cancellation and Additional Payments) Regulations 2013.

The Consumer Rights Act 2015 is also coming into effect on 1 October 2015 and will affect all businesses selling to consumers. These new regulations only apply to consumers and not to any customers buying goods in the course of running their business.

See also: 10 steps to farm shop staff recruitment success

Your customer has a right to cancel online purchases, for any reason, within 14 days of receiving the goods and will also have additional rights if the goods are defective.

He will have up to 14 days from the day after he informed you that he wanted to cancel his order, to return the goods to you intact.

If he returns the goods within this period, you must refund him within 14 days of receiving them, or of the date he provides you with proof of postage (if earlier).

You will need to refund:

• Full amount paid by the customer for the unopened goods
• Any standard delivery costs paid by the customer.

However, the customer will be required to pay the cost of returning the goods to you provided your terms and conditions clearly state this and the goods are not faulty.

If some of the goods have been opened, then for health protection and hygiene reasons, you will only be required to refund him for the unopened ones (again, provided the goods are not faulty).

His cancellation rights do not apply to any produce that is perishable or otherwise likely to deteriorate or expire rapidly (for example, fresh meat or dairy products).

If you sell online, you must satisfy additional requirements. You must provide potential customers with what is known as “pre-contract information”. The information includes:

• Details of the right to cancel
• How to pay
• Main characteristics of the goods
• Your identity and contact details
• The total price of the goods inclusive of taxes and delivery charges (where applicable).

Additionally, you will need to seek your potential customers’ express acknowledgement of their obligation to pay before they can be bound by the order.

You must ensure you comply with these legal requirements because if you fail to provide the pre-contract information, your customers have 12 months to cancel the contract.

Your customers may have additional rights from 1 October. If the goods are defective under the forthcoming Consumer Rights Act 2015, they will be able to reject them within 30 days (usually from delivery) and obtain a full refund.

If you sell perishable goods, the customer can only reject them up until the “consume by” or “use by” date. There may be issues around their suitable storage by the customer in the meantime.

Finally, when dealing with consumers, be fair. If you attempt to limit or exclude your liability or impose restrictions on consumers’ legal rights, this may not be effective.

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